CHILMARK, Mass. — President Obama announced Thursday that the United States had canceled longstanding joint military exercises with the Egyptian Army set for next month, using one of his few obvious forms of leverage to rebuke Egypt’s military-backed government for its brutal crackdown on supporters of the ousted president, Mohamed Morsi.

Though the decision is an embarrassment to Egypt’s generals, and will deprive Egypt of much-needed revenue, it lays bare both the Obama administration’s limited options to curb the military’s campaign against Islamists in Egypt and the United States’ role as an increasingly frustrated bystander.

Repeated pleas from administration officials to the generals to change course have gone unheeded, and the United States’ first punitive measure, a Pentagon delay in the delivery of four F-16 fighter jets to the Egyptian Air Force, also had no effect.

Mr. Obama, interrupting his vacation on Martha’s Vineyard to address the violence, struck a now-familiar balance. He expressed outrage at the harrowing scenes this week in Cairo and other cities, while taking pains to preserve the American relationship with the Egyptian armed forces, which are underwritten by the vast bulk of the $1.5 billion a year in military and economic aid.

With the death toll in Egypt soaring and no sign that the country’s generals are heeding American calls to stop the violence, however, administration officials said they now faced a more wrenching choice: to keep backing the generals, whatever the cost, or to admit that the current relationship is no longer tenable.

“While we want to sustain our relationship with Egypt, our traditional cooperation cannot continue as usual when civilians are being killed in the streets and rights are being rolled back,” Mr. Obama said, reading a statement in front of his rented vacation house here, the sun-splashed trees an incongruous backdrop for his stark message.

In his remarks, Mr. Obama noted “it’s tempting” inside Egypt to blame the United States, saying that protesters accused it alternately of backing Mr. Morsi or colluding with those who ousted him. But Mr. Obama’s reluctance to be drawn into conflicts in the Mideast, from Syria to Bahrain, has frequently been criticized.

Until the latest eruption of violence, White House officials were still uncertain whether the Egyptian military might yet rewind history and give democracy a fresh chance, or if it was simply restoring the sort of autocracy that has dominated Egypt in the past. Now they said they seem to have the answer.

But while their frustration is palpable, officials said there were voices in favor of working with Egypt and of cutting off its aid, and they expected the debate would take time to play out.

White House officials said Mr. Obama issued the order to pull the United States out of the military exercises, known as Bright Star, in a phone call with his national security adviser, Susan E. Rice, on Wednesday evening. The Egyptians were notified before the president’s announcement, and Defense Secretary Chuck Hagel later spoke by telephone with Egypt’s defense minister, Gen. Abdul-Fattah el-Sisi.

Despite the large scale of the exercises, and the fact that they date to the 1980s, administration officials said they had few illusions that the decision would by itself stop the crackdown. Egypt’s military leaders, they said, regard the Islamist protests as an “existential threat” to the nation, which they must crush at all costs.

Mr. Obama said he had instructed his national security staff to weigh additional measures. He did not specify what those could be, though he said nothing about suspending the military aid. “We’ll be looking at both the case-by-case examples but also the more fundamental relationship,” said a senior official, who spoke on the condition of anonymity to discuss internal deliberations. “There’s a basic threshold where we can’t give a tacit endorsement to them.”

Video

Cleanup in Cairo

In Cairo, cleanup efforts were under way at two camps of supporters of Mohamed Morsi that were destroyed Wednesday by security forces.

Given the deep schism in Egypt, this official said, the White House is still skeptical that cutting off aid would compel the generals to return the country to a democratic transition. And it could destabilize the region, particularly the security of Israel, whose 1979 peace treaty with Egypt is predicated on the aid.

For weeks, officials from Israel and several Arab countries have pressured the administration to maintain the flow of aid. If it were cut off, they said, Saudi Arabia, Kuwait and the United Arab Emirates would move quickly to make up the shortfall — and then some.

Saudi Arabia and the emirates pledged $8 billion in grants and loans to Egypt’s post-Morsi government last month: $5 billion from Saudi Arabia in grants and loans; $3 billion from the emirates. That is more than enough, analysts say, to offset any cutoff from the United States, even if the two countries do not fulfill their entire pledges.

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Shutting off the aid spigot now would not have an immediate impact on the Egyptian military, defense officials say, because this year’s military assistance has already been delivered. Beyond money, Arab officials worry that a rupture between Washington and the Egyptian military would further erode American influence in a country that has historically been a bellwether in the Arab world, and would open the door to rivals like Russia or China.

“If the aid gets cut, you can be sure that Putin will arrive in Cairo in two or three months,” one senior Arab official said. “And he will give aid with no strings attached.”

Still, even with the aid flowing, Defense Department officials fear that whatever leverage the Pentagon might have had with Egypt’s military leadership is ebbing quickly. Since the military’s ouster of Mr. Morsi on July 3, Mr. Hagel has had more than 15 phone calls with General Sisi, pleading in vain for him to change course.

Mr. Hagel, in a statement on Thursday, said that in his latest exchange with the general, “I made it clear that the violence and inadequate steps towards reconciliation are putting important elements of our longstanding defense cooperation at risk.”

While administration officials acknowledge that Egypt could replace the lost American military aid, they said it would pay a long-term price in lost foreign investment and a ruined tourism industry — a point that Mr. Obama made in his statement on Thursday.

Some analysts said the administration had hurt itself by not undertaking a thorough review of its policy toward Egypt after the ouster of President Hosni Mubarak in 2011. The United States, they said, was too wedded to the privileges it gained from the relationship, like fly-over rights and fast-track transit through the Suez Canal.

“They’ve limited their own options by believing the idea that in order to influence things, you need to remain engaged,” said Steven A. Cook, an expert on Egypt at the Council on Foreign Relations. “We’ve never tested the proposition of cutting them off.”

Other experts said Mr. Obama had few attractive alternatives and mainly wanted to keep out of the situation.

“Anything they do that is dramatic puts the United States in the middle of a story that we really don’t want to be in the middle of,” said Steven Simon, a former National Security Council official under Mr. Obama who is now head of the Washington office of the International Institute for Strategic Studies.

Heather Hurlburt, a former Clinton White House official who is now the executive director of the National Security Network, said the administration should cut off “targeted” cooperation with Egypt’s military without halting all aid. “No matter where you’re coming from ideologically,” she said, “the playing field we face in the Middle East is not the playing field we faced a month ago.”

Senator John McCain, the Arizona Republican who just returned from a trip to Cairo at Mr. Obama’s request, was sharply critical of the president for not acting more forcefully against the military takeover, citing a law requiring the cutoff of American aid to countries where a military coup has dislodged an elected government. Mr. McCain has said the Muslim Brotherhood needs to accept that Mr. Morsi will not be returned to power, but he has also urged the military to establish a democratic process. “We violated our own rule of law by not calling it for what it is,” Mr. McCain said on CNN. “We undercut our own values.”

A version of this article appears in print on August 16, 2013, on Page A1 of the New York edition with the headline: His Options Few, Obama Rebukes Egypt’s Leaders. Order Reprints|Today's Paper|Subscribe